7 Home Upgrades That Make a Huge Value Impact
The real estate market has enjoyed a major boom in the last two years. As a result, home values have skyrocketed, which has made buying a home more challenging than ever. As a result, homeowners look inward instead of outward when moving from their current homes.
Buying a new home is ideal, but if there aren’t any affordable homes for sale that meet your needs, you have to find an alternative. This is why so many homeowners have decided to upgrade their existing homes.
From 2020 to 2021, the home renovation industry grew to $369 billion, a 9% increase over 2020. Renovation revenues have been rising since 2009, and industry experts agree the sector will continue to grow by 4% annually.
Nine out of ten homes in the U.S. were built before 2000, and many of them require repairs and upgrades. So, it should be no surprise that 76% of American homeowners completed a renovation project in 2020.
Most homeowners spend $18,000 on their projects. But does that money come back in home values? Research suggests home remodeling projects’ average return on investment is about 56%. But, of course, that return can fluctuate based on the type of renovation and market conditions.
Completing a home renovation project is a sound investment for most homeowners. What’s even better—you get to enjoy a space that’s uniquely yours while building equity in your home. Here are seven home upgrades that make a considerable value impact.
7 Home Upgrades That Add Value
1. Add an Outdoor Living Space
Whether you want a patio, a screened-in porch, or just to upgrade your landscaping, outdoor living spaces are always a popular spot for homeowners to invest their money. About one in three homeowners planned to do outdoor renovations in 2021. And it’s easy to see why. Outside, you can create a space unlike anything inside while enjoying the benefits of the outdoors.
Some owners prefer to add patios to their outdoor areas, as well. With a 47.6% return on investment, patios aren’t as profitable as decks, but they are still a wonderful way to cultivate the perfect outdoor living area. Depending on your space and layout, a patio could be an excellent option for your home.
2. Improve the Curb Appeal
Curb appeal is a fundamental part of your home’s value. It’s the first thing people see when they come to your home, whether as a guest or to check it out to (hopefully) buy the property. You can add a few worthwhile upgrades to make your home’s exterior shine—and the value increase.
Adding stone veneer to the exterior is an excellent way to upgrade your home’s facade. Many people chose to add it around the front door or even skirt the house with decorative stone. When you do a project like this, you can expect a 97.1% return on investment.
Updating your siding is another facade update that can have a big payoff. Experts estimate a 76.7% return on investment when you replace the siding. Of course, this doesn’t have as big of a payoff as stone, but still an upgrade to seriously consider to improve the home’s appearance.
3. Replace the Roof, Windows, and Doors
But there’s more to your curb appeal than the facade. Updating the essential elements of your home, like the roof, windows, and doors, increase the value and makes the home much more energy efficient.
Simply switching out your entry door and adding attractive hardware can provide a 91.3% return on investment. Windows are another high-value upgrade as they offer an average 89.6% return. Replacing the roof, although not as visually appealing as new windows and doors, is also known to significantly increase a home’s value.
4. Update Your Kitchen
Kitchen upgrades are by far one of the most popular ways to update a home. A lot of time is spent in the kitchen, which is why this room is often called the heart of the house. What’s more, any real estate agent will tell you that kitchens sell homes.
However, embarking on a kitchen renovation is daunting. Kitchens have a lot of components, which means there are many things you need to consider throughout the remodeling process. Be prepared to make decisions about everything from appliances, cabinets, flooring, countertops, hardware, faucets, and lighting when upgrading your kitchen.
For most people, these upgrades will cost anywhere from $25,000 for a minor renovation to $70,000 for a major one. What’s more interesting is the return on a minor upgrade is greater than on a major remodel. For example, you can expect an 81.1% return on a minor kitchen project and 59% for a major kitchen renovation.
5. Remodel a Bathroom
When most people look at homes, they care about two things: the kitchen and the bathrooms. Having several functional, well-designed, beautiful bathrooms is a huge selling point for any home. Likewise, upgrading or adding a bathroom can make a considerable value impact on your property.
Remodeling an existing bathroom provides a larger return than adding an entirely new bathroom to the home. As convenient as having additional bathrooms can be, they usually come at the expense of some other space in the house, making a bedroom or office smaller than it needs to be.
6. Finish your basement
If you have an unfinished basement, you have a whole room full of opportunities. For example, you could create a game room, home theater, office, gym, spare bedroom, or a combination of all five!
These spaces are great because they’re raw and flexible. You can mold your basement to meet your needs, whatever they may be.
And not only do finished basements provide more living space, but they also enhance your home’s value. Real estate experts estimate the finished basement value to be about half the value of the home’s main level square footage. Bearing that in mind, keep your basement renovation to about 5 to 10% of the home’s value to ensure you get a good return and don’t overspend on the remodel.
7. Refresh the Cosmetics
Doing big renovation projects is fun, but upgrading your cosmetics is a good way to go if you need to keep the budget small.
A fresh coat of paint, replacing the door and cabinet hardware, and upgrading lighting are all easy, affordable ways to improve your home’s value. And most homeowners are comfortable doing these upgrades themselves, eliminating the labor cost.
Your home is one of your biggest financial investments. Make the most of it by upgrading elements that make a huge value impact.